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You dont need abstract math to research collectivism, in fact you shouldnt since you will consistently fail to factor properly the most important part - human n

You dont need abstract math to research collectivism, in fact you shouldnt since you will consistently fail to factor properly the most important part - human nature. Just look at communism and its utter failures in ie eastern europe when it was enslaved by soviet russia union during cold war. Nobody wanted willingly to give up their fields and farms, so fathers we re forced to sign contracts at gunpoint. Stories like these are not that rare, I knoe personally few whose granddads lost it all to aparatchiks. Anyway, it was an utter failure, as communism is. Central planning doesnt work, farmers with intimate knowledge of their fields and crops were much more effective and motivated than then some random workers who tought mainly about themselves and stealing common property rather some common good. Corruption, selfishness, laziness are things that collapse any similar pipe dream society, or make it at least very ineffective.

RandomLensman 3y ago
Not disagreeing with the historic view, but oddly enough, when it comes to corporations we see collective pooling and central planning as totally normal (kind of the last bastion of communism).
- saiya-jin 3y ago
  I am not advocating for anarchy in any way, somebody has to steer the wheel of any big enough corporation, or company is bust within few very bad moves. The problem comes when power resides in hands which are incompetent (frequent communism issue, people get power for rectal speology and not proven hard skills). Or even worse they are competent, but incentives are completely misaligned - ceos having tens of millions as yearly base salary, golden parachutes regardless of fubar they create, then they look for additional means of their own profit, regardless of harm to company. Those highly functioning sociopaths would grok say government-mandated jail terms for really bad stuff (TM) very quickly if it would be on the table, but its not and everybody up there knows it.
sureglymop 3y ago
Capitalism is objectively a failure too (in certain countries, e.g. the US). And arguably that is also due to human nature. In Europe there are thriving social democracies in some states. No one is being held at gunpoint because that is one extreme. These are still capitalist nations, just not across the board.
- automatic6131 3y ago
  >Capitalism is objectively a failure too (in certain countries, e.g. the US) For one, no country on earth has ever been Capitalist. The word itself is a Marxist word describing a system that worships capital, it's actually meant to be derogatory and sarcastic. Every western country today is a liberal democracy and follows Liberalism, where any one in particular lies on a spectrum from Capitalist to Communist is variable but only within a fairly small range. Finally, only a wilful idiot could call the current US a "failure". Is it flawed, far from perfect, miserable for a large part of its population? Yes. But does it also deliver them from starvation, war and natural disaster? Yeah, mostly. Better than nearly all other systems. It could do better, maybe a lot better, but it's so far from "failure" it's quite laughable. But besides from that, European-style social democracies (note, also liberalist) can only exist because the US exists to guarantee that you can be that way safely. And because advanced, rich nations are more profitable for the US to trade with.
  - vidarh 3y ago
    Marx spent the first half of the first chapter of the Communist Manifesto "worshipping capitalism" and praising capitalism for more extensive advances than ever before. Marx strenuously agreed with your "better than nearly all other systems" to the point where he argued capitalism was a necessity in order for socialism to even become possible, because of the immense economic growth brought by capitalism. It's not Marxist to hate capitalism, it's Marxist to see capitalism as an incredible advance over what came before, which can still be improved on thanks to capitalism laying the foundation for further advances.
- boppo1 3y ago
  Please see my comment history for my post immediately prior to this one. We agree that the wealthy have a disproportionate slice, at least, but I think I have a more specific and realistically-addressable cause than 'capitalism'..
boppo1 3y ago
>Central planning doesnt work This is funny because it's the reason so many people are questioning the status quo or what they call 'capitalism' these days. The FOMC is at the center of the US (and to a large extent global) economy. It is a central planning body, arguably responsible for the stagnation in wages. Copied from a comment I wrote some days ago: It's a little convoluted, but google 'dcf model', 'benchmark rates', and 'open market operations'. It's more than a single post to explain the mechanics, but you can grok it in a few afternoons. I'll attempt anyway: In order to figure out what activities we ought to allocate resources to, we compare their present values as a sum of future cash flows, each period 'discounted' by a rate. The rate is calculated based on the activities risks + a 'benchmark' or 'risk free' rate. Basically "this activity is risky, how much more should it pay than something totally without risk?" The closest thing we have to that is US debt. US bonds have a set face value and interest rate, but if you buy above/below the face value, the interest will be a higher or lower return on what you paid, 'yield'. US debt is the most active market in the world, so taking the 'yield' shows what rate the global market[0] is accepting 'risk free' investment. If the market is nervous, more bonds get bought because everyone wants 'safety'. But this drives up the bond price and lowers yield. Lower yields create an incentive to consider 'hey maybe we do something a little risky after all, it pays better.' Vice versa: if the market is buying risky stuff instead of safe bonds, yields go up and people think 'why do something risky if I can get that return with no risk'? BUT the Fed interferes in this market. They have unlimited power to buy/sell bonds and therefore establish price ceilings and floors[1]. For most of the past 20 years they created a high price floor, which means low yields. This forces society to allocate resources to risky activity with higher returns. In particular, when rates go down, cash flows in the future relatively contribute more to present value. With higher rates you look harder at the next 20 years. With lower rates, you look more at years 20+[2]. In practice it made any business that can 'promise the future' an attractive investment. Think Big Tech, VC startups, Tesla, Wework, Theranos. Meanwhile, businesses that are less risky and make goods and services now have to compete with those guys for ROI. If you have little hope of growth, and your business is established you have to raise prices or reduce costs somewhere. You can't control what you pay for raw materials/inputs, but you can control what you pay workers. To further illustrate: Google burns hundreds of billions on projects that never see daylight or get axed after a couple years. How did market forces decide that was a better use of resources than building (relatively) more hospitals and bridges? Fed yield interference. I'm not saying high rates are good, or low rates are bad. I'm saying rates that don't match market conditions are bad. [0] Explainer on the bond market for the uninitiated: Big companies can't safely keep a lot of cash as currency because FDIC insurance is meant for individuals and only covers 250k. Instead you buy something 'safe' and very easily tradeable or 'liquid'. In the past, this might have been gold. Now it's US debt, which works better than gold for this purpose (diff maturities, easier settlement, etc.) [1] These are decided by a committee of 12 individuals, the FOMC. [2]To see this for yourself, model out a dcf and then add a row where you divide each discounted cash flow by the present value, "contribution to PV". Then, set up a bar chart for this row and play with your discount rate to see how the "time-shape" of PV contributions changes.

RandomLensman 3y ago

Not disagreeing with the historic view, but oddly enough, when it comes to corporations we see collective pooling and central planning as totally normal (kind of the last bastion of communism).

saiya-jin 3y ago
I am not advocating for anarchy in any way, somebody has to steer the wheel of any big enough corporation, or company is bust within few very bad moves. The problem comes when power resides in hands which are incompetent (frequent communism issue, people get power for rectal speology and not proven hard skills). Or even worse they are competent, but incentives are completely misaligned - ceos having tens of millions as yearly base salary, golden parachutes regardless of fubar they create, then they look for additional means of their own profit, regardless of harm to company. Those highly functioning sociopaths would grok say government-mandated jail terms for really bad stuff (TM) very quickly if it would be on the table, but its not and everybody up there knows it.

sureglymop 3y ago

Capitalism is objectively a failure too (in certain countries, e.g. the US). And arguably that is also due to human nature. In Europe there are thriving social democracies in some states. No one is being held at gunpoint because that is one extreme. These are still capitalist nations, just not across the board.

automatic6131 3y ago
>Capitalism is objectively a failure too (in certain countries, e.g. the US) For one, no country on earth has ever been Capitalist. The word itself is a Marxist word describing a system that worships capital, it's actually meant to be derogatory and sarcastic. Every western country today is a liberal democracy and follows Liberalism, where any one in particular lies on a spectrum from Capitalist to Communist is variable but only within a fairly small range. Finally, only a wilful idiot could call the current US a "failure". Is it flawed, far from perfect, miserable for a large part of its population? Yes. But does it also deliver them from starvation, war and natural disaster? Yeah, mostly. Better than nearly all other systems. It could do better, maybe a lot better, but it's so far from "failure" it's quite laughable. But besides from that, European-style social democracies (note, also liberalist) can only exist because the US exists to guarantee that you can be that way safely. And because advanced, rich nations are more profitable for the US to trade with.
- vidarh 3y ago
  Marx spent the first half of the first chapter of the Communist Manifesto "worshipping capitalism" and praising capitalism for more extensive advances than ever before. Marx strenuously agreed with your "better than nearly all other systems" to the point where he argued capitalism was a necessity in order for socialism to even become possible, because of the immense economic growth brought by capitalism. It's not Marxist to hate capitalism, it's Marxist to see capitalism as an incredible advance over what came before, which can still be improved on thanks to capitalism laying the foundation for further advances.
boppo1 3y ago
Please see my comment history for my post immediately prior to this one. We agree that the wealthy have a disproportionate slice, at least, but I think I have a more specific and realistically-addressable cause than 'capitalism'..

boppo1 3y ago

>Central planning doesnt work This is funny because it's the reason so many people are questioning the status quo or what they call 'capitalism' these days. The FOMC is at the center of the US (and to a large extent global) economy. It is a central planning body, arguably responsible for the stagnation in wages. Copied from a comment I wrote some days ago: It's a little convoluted, but google 'dcf model', 'benchmark rates', and 'open market operations'. It's more than a single post to explain the mechanics, but you can grok it in a few afternoons. I'll attempt anyway: In order to figure out what activities we ought to allocate resources to, we compare their present values as a sum of future cash flows, each period 'discounted' by a rate. The rate is calculated based on the activities risks + a 'benchmark' or 'risk free' rate. Basically "this activity is risky, how much more should it pay than something totally without risk?" The closest thing we have to that is US debt. US bonds have a set face value and interest rate, but if you buy above/below the face value, the interest will be a higher or lower return on what you paid, 'yield'. US debt is the most active market in the world, so taking the 'yield' shows what rate the global market[0] is accepting 'risk free' investment. If the market is nervous, more bonds get bought because everyone wants 'safety'. But this drives up the bond price and lowers yield. Lower yields create an incentive to consider 'hey maybe we do something a little risky after all, it pays better.' Vice versa: if the market is buying risky stuff instead of safe bonds, yields go up and people think 'why do something risky if I can get that return with no risk'? BUT the Fed interferes in this market. They have unlimited power to buy/sell bonds and therefore establish price ceilings and floors[1]. For most of the past 20 years they created a high price floor, which means low yields. This forces society to allocate resources to risky activity with higher returns. In particular, when rates go down, cash flows in the future relatively contribute more to present value. With higher rates you look harder at the next 20 years. With lower rates, you look more at years 20+[2]. In practice it made any business that can 'promise the future' an attractive investment. Think Big Tech, VC startups, Tesla, Wework, Theranos. Meanwhile, businesses that are less risky and make goods and services now have to compete with those guys for ROI. If you have little hope of growth, and your business is established you have to raise prices or reduce costs somewhere. You can't control what you pay for raw materials/inputs, but you can control what you pay workers. To further illustrate: Google burns hundreds of billions on projects that never see daylight or get axed after a couple years. How did market forces decide that was a better use of resources than building (relatively) more hospitals and bridges? Fed yield interference. I'm not saying high rates are good, or low rates are bad. I'm saying rates that don't match market conditions are bad. [0] Explainer on the bond market for the uninitiated: Big companies can't safely keep a lot of cash as currency because FDIC insurance is meant for individuals and only covers 250k. Instead you buy something 'safe' and very easily tradeable or 'liquid'. In the past, this might have been gold. Now it's US debt, which works better than gold for this purpose (diff maturities, easier settlement, etc.) [1] These are decided by a committee of 12 individuals, the FOMC. [2]To see this for yourself, model out a dcf and then add a row where you divide each discounted cash flow by the present value, "contribution to PV". Then, set up a bar chart for this row and play with your discount rate to see how the "time-shape" of PV contributions changes.